Wealthy nations’ $300bn pledge targets resolution of COP29 negotiation

Onome Amuge

The European Union, the United States, and other wealthy countries have revised their offer of financial assistance to developing nations at the COP29 summit, raising their annual pledge to $300 billion from $250 by 2035.

The new commitment represents an increase over the previous proposal of $250 billion, which was criticised as “insultingly low” by many developing countries.

The COP29 summit, originally set to conclude on Friday, endured into overtime as negotiators from nearly 200 nations engaged in intense discussions to reach consensus on a critical climate funding plan for the next decade.

The negotiations were met with a breakthrough as the EU, US, and other wealthy countries, following intense pressure from developing nations, boosted their climate finance pledge from a previously rejected $250 billion proposal to a more promising $300 billion per year by 2035.

Amid the frenzied negotiations at the COP29 summit, it was unclear whether the wealthy nations’ revised $300 billion pledge had been formally presented to developing countries.

Nevertheless, multiple sources privy to the closed-door discussions revealed that the European Union had agreed to the higher figure. Two sources further confirmed that the U.S, Australia, and Britain also supported the new offer. The question remained, however, whether this increase would be sufficient to persuade developing nations to sign onto the climate funding deal.

The COP29 summit was at a critical impasse as the presidency remained tight-lipped about the latest draft of the climate funding deal. With negotiators from nearly 200 countries left in the dark, uneasiness settled over the talks, and Panama’s lead negotiator, Juan Carlos Monterrey Gomez, voiced the collective concerns of many when he said, “There is no clarity on the way forward. There is no clarity on the political will that we need to get out of this.”

Meanwhile, Marina Silva, Brazil’s minister of environment and climate change, had emphasised her country’s commitment to protecting the Amazon rainforest and climate stability. She expressed her desire for wealthy nations to pledge at least $390 billion by 2035.

The COP29 climate negotiations shone a spotlight on the widening chasm between developed countries constrained by their own budget limitations and developing nations facing the crushing cost of climate-related catastrophes such as storms, floods, and droughts.

With the $100 billion climate finance commitment made to poorer nations in 2020 not met until two years later, in 2022, the urgency of creating a new goal that would replace this commitment and better address the mounting challenges of climate change became all the more apparent.

In the midst of the two-week summit, negotiators were tirelessly seeking to resolve the highly contentious issues surrounding the new climate finance target, including the thorny questions of who should contribute and in what proportion.

The list of countries expected to provide funding, approximately two dozen developed nations, including the U.S., European countries, and Canada, was first determined in 1992 during UN climate talks.

Europe’s demand that other countries, notably China and the oil-rich Gulf states, contribute to the climate finance target has been a contentious issue.

Meanwhile, the recent election of Donald Trump as U.S. president has sent ripples of concern through the COP29 talks in Baku.

Trump’s skepticism towards climate change, calling it a hoax, has fueled doubts among negotiators from other wealthy countries that the U.S., the world’s largest economy, will contribute to the new climate finance target during the upcoming four-year term under Trump’s leadership.

Amidst the frantic negotiations, the proposed draft deal published on Friday included a more ambitious target of raising $1.3 trillion in climate finance annually by 2035, a sum that economists believe is necessary to address the ongoing climate crisis. This figure, however, relies not only on contributions from developed countries but also on funding from all public and private sources, including investors and the private sector.

Developing nations have cautioned that a weak agreement on climate finance at COP29 would severely undermine their ability to set more ambitious greenhouse gas emission reduction targets, which are urgently needed to mitigate the worst effects of climate change.